Author Question: Use the aggregate expenditures model and assume the marginal propensity to consume (MPC) is 0.90 . A ... (Read 60 times)

tichca · **on:** Jun 30, 2018

Use the aggregate expenditures model and assume the marginal propensity to consume (MPC) is 0.90 . A decrease in government spending of 1 billion would result in a decrease in GDP of:
a. 0.
b. 0.9 billion.
c. 1.0 billion.
d. 9.0 billion.
e. 10.0 billion.

Question 2

A majority of the commercial banks in the United States are not members of the Fed.
a. True
b. False
Indicate whether the statement is true or false